Feb. 6 (Bloomberg) -- Canadian Finance Minister Jim
Flaherty said he’s aiming to balance the country’s budget as
planned by 2015 through additional spending cuts, even as the
government’s revenue outlook weakens.

“We are on track to balance the budget in the current
parliament, which means 2015,” Flaherty said in a speech today
in Ottawa marking his seventh year as finance chief, adding he
is prepared to be flexible if the global economy deteriorates.

Flaherty said in November he planned to balance the budget
in 2015 by clamping down on spending, even as he pared revenue
projections by C$36 billion ($36 billion) over five years.
Flaherty hasn’t set a date for this year’s budget.

Canada’s revenue outlook has deteriorated further since
November on signs the economy has slowed, making it more
difficult to bring the budget into balance, a person with direct
knowledge of budget planning said last month. Canada is the only
Group of Seven country with a stable AAA debt rating.

“In uncertain global economic times, the most important
contribution a government can make to bolster confidence and
growth is to maintain a sound fiscal position,” Flaherty said.

Canadian government bond yields declined today, with the
10-year security falling to 1.98 percent from 2.02 percent. The
price of the 2.75 percent coupon bond due in June 2022 rose 23
Canadian cents to C$106.46 at 3:15 p.m.

Weaker Growth

Growth in nominal GDP, which includes price changes and is
a more accurate reflection of the government’s tax base, “is
weaker than we would like,” Flaherty told reporters after the
speech. “We have to do more on the controlling our own spending
side.”

Flaherty said he is concerned by the gap between the price
of Canadian crude and other world oil prices, which is having an
impact on the government’s finances. The price of Western Canada
Select, a blend of oil-sands bitumen produced in Alberta, is
trading at about $28.50 below U.S. benchmark West Texas
Intermediate oil.

“We are prepared to be flexible and pragmatic should
circumstances warrant,” said Flaherty. We “will remain focused
on the things that we can control.”

That includes ruling out “risky” spending programs,
adding to infrastructure spending only if the fiscal situation
allows and “eliminating wasteful or ineffective spending,” he
said. The government won’t impose new taxes, he said.

The next budget will also focus on ways to boost research
and development and worker skill development, Flaherty said.